An Industry in Motion

According to the Chinese zodiac, 2014 is the year of the horse, which is sort of fitting since Jeff Bezos, Amazon.com founder and now owner of the Washington Post, compared newspapers to the animal during an interview last year. Bezos said, “I think printed newspapers on actual paper may be a luxury item. It’s sort of like…people still have horses, but it’s not their primary way of commuting to the office.”

Yes, people may still use horses, but they also use buses, trains and cars. Horses are just one way of getting from here to there. If you’re following the analogy, can’t the same be said of the newspaper industry? To get the news from “here to there,” there are plenty of platforms from which to choose, from the print product landing on our driveways to the Twitter updates on our mobile phones.

As we enter a new year, E&P has put together a list of people, popular topics and noteworthy companies we feel will be taking the reins (or steering wheel) in the newspaper industry. You can compare newspapers to whatever mode of transportation you want, just be assured, the industry won’t be standing still.

PEOPLE

Jeff Bezos

The Washington Post caught the industry off-guard last August when it announced the Amazon.com founder as its next owner.

Bezos paid $250 million in cash for the publication.

Although Bezos hasn’t laid out a specific game plan yet, he plans to practice the same things that made Amazon successful. “Put the customer first. Invent. And be patient,” he said in an interview with the Post.

With Amazon’s advances in video, e-commerce and customer service, will Bezos apply the same innovation at the Post?

Aaron Kushner

Kushner’s 2100 Trust LLC completed its purchase of Freedom Communications, parent company of The Orange County Register (Santa Ana, Calif.) in July 2012.

A year later, the Register unveiled a paywall, doubled its newsroom and expanded the page count in its print products. It also launched the Long Beach Register in August 2013 and purchased the Press-Enterprise in Riverside, Calif. two months later.

Kushner recently announced he plans to launch the Los Angeles Register, a stand-alone product separate from the Orange County Register.

Lately, Kushner has been making headlines for his company’s legal issues. Among them is a lawsuit from two former Register executives seeking $4.5 million in severance pay.

Warren Buffett

Buffett’s company, Berkshire Hathaway Inc, formed BH Media Group with the purchase of the Omaha-World Herald in December 2011. In 2012, the company purchased 63 newspapers from Media General Inc. Over the course of last year, Buffett also added the Greensboro, N.C. News Record, Virginia’s Roanoke Times, the Press in Atlantic City, N.J. and the Tulsa World.

Buffett passed on publications such as the Tampa Tribune and Washington Post in order to invest in smaller, mid-sized papers.

By building a collection of community papers, it seems as though Buffett is betting on local news to make a profit.

As we enter 2014, will Buffett show any sign of stopping his newspaper shopping spree?

John Henry

The Boston Red Sox owner bought the Boston Globe from the New York Times Co. just two days before Bezos’ purchase of the Washington Post was announced. Henry paid $70 million for the Globe along with the Worcester Telegram and Gazette newspaper.

The sale to Henry meant a return to local ownership after the Taylor family sold the paper to the Times Co. in 1993.

With the Boston Marathon bombing still in the news and the Red Sox crowned 2013 World Series champions, many will be keeping a close eye on this city.

After 86 years, the Red Sox won their first championship in 2004 with Henry as owner. Will he able to rejuvenate his newspaper teams in the same way?

Pierre Omidyar

The eBay founder announced last fall he was going to invest $250 million into an investigative media project tentatively called NewCo with former Guardian reporter Glenn Greenwald.

At press time, there was no targeted launch date for the news site, but there has been plenty of interest on Omidyar’s vision of delivering news in the digital age.

Joanne Bradford

The former San Francisco Chronicle president was hired by Pinterest in November to lead advertiser and media partnerships.

Bradford still serves as an advisor to the newspaper in its digital and marketing efforts and will also work closely with parent company, Hearst Corp.

Pinterest recently confirmed it was valued at $3.8 billion.

By hiring Bradford, who also held media roles at Yahoo and Microsoft, Pinterest seems invested in generating revenue from its network of advertisers and media partners.

Rupert Murdoch

The news mogul is no stranger to making headlines, but the industry is especially paying attention to the British phone hacking scandal involving his now-defunct News of the World tabloid.

Not afraid to experiment, Murdoch’s News Corp. launched The Daily, an iPad-only newspaper, in 2011. Unfortunately, it closed less than two years later. The New York Times reported it was losing around $30 million a year.

Last year, News Corp. spun off its publishing division (which includes The Wall Street Journal and The New York Post) from its entertainment unit. Murdoch said the split would “simplify operations and greater align strategic priorities.”

Rumors have been circulating for a few years that Murdoch is interested in purchasing the Los Angeles Times from the Tribune Co. Will those rumors be put to rest in 2014 or will they be proven as fact?

The 18-29-year-old reader

Dubbed “digital natives,” the millennial is probably the most sought after reader in the industry.

According to the Newspaper Association of America, 40 million millennials receive their news and information from newspaper media across all platforms each week.

The industry has tried everything from social media to video to engage young readers with their content and advertisements.

In this evolving industry, milliennials are more likely to be open to change. As the industry shifts their methods to meet their needs, will this generation follow?

TOPICS

The Paywall

The New York Times introduced its paywall in 2011 and many media companies look at their pay model as a successful example. Last October, the New York Times Co. reported paid subscribers to the Times and International Herald Tribune digital-only subscription packages, e-readers and replica editions totaled about 727,000 as of the end of the third quarter of 2013, an increase of more than 28 percent compared with the end of the third quarter of 2012.

In 2013, Gannett added digital pay plans to all 80 of its community papers while USA Today remains free for now. Digital First Media announced it would also add paywalls at most its daily newspapers.

The San Francisco Chronicle and the Dallas Morning News both dismantled their paywalls last year.

Whether companies are erecting or tearing down paywalls, digital subscriptions are something the industry will keep on experimenting with this year.

Mobile

A Reynolds Journalism Institute survey found 52 percent of newspaper subscribers used a mobile device to read news. Fifty-five percent of respondents indicated they were mobile news consumers in 2013 up from 42 percent in 2012.

Pew Research Center’s 2013 State of the News Media report found 64 percent of tablet users and 62 percent of smartphone users receive their news on their devices weekly.

A recent NAA Sensemaker Report found half of all digital readers to newspapers now access the content on mobile devices.

The data suggests publishers have the chance to design content to reach new markets and create new revenue streams.

Social media

A Pew Research study found 47 percent of smartphone users said they got news through a social network “sometimes” or “regularly.” Some 39 percent of tablet news users did so as well.

A separate Pew Research study reported 72 percent of online adults use social networking sites.

News organizations are flocking to platforms such as Youtube and Twitter to push content out especially when it comes to breaking news.

As print advertising declines, online ad revenue is growing slowly. The Pew Research Center reported print revenue brought in close to $19 billion in 2012. Total digital rose to $37.3 billion in 2012, a 17 percent increase.

Also reported by Pew, digital ads outpaced newspaper advertising for the first time in 2011, now making up 23 percent of overall U.S. advertising, second only to television ads.

The NAA reported that in 2013, media buyers expected to see an average increase of 12.6 percent in native ad spending compared to 2012.

Publications like the New York Times will roll out a native advertising platform on its site in the next several months.

The print product

In 2012, Advance Publications announced the New Orleans Times-Picayune would no longer be printed daily, but only three times a week in order to expand online coverage.

Meanwhile, Freedom Communications invested heavily in print with its Southern California publications by adding 25 new weekly sections and more pages to its portfolio of community newspapers.

Print advertising continues to decline. The Pew Research Center reported real estate classified ads dipped the most in 2012 with a loss of more than 15 percent for the year.

Many publishers still tout print as their primary product, but will print be included in some of their cost-cutting measures next year?

Analytics

More publishers are turning to products such as Google Analytics, Chartbeat and comScore to decipher data and numbers in order to learn more about their audience.

Analytics are now being used as a selling tool to advertisers since data sells and shows results.

Data determines who is visiting your site, what they’re reading, how long they’re staying and can lead to new revenue opportunities.

Content

The Washington Post introduced sponsored content with “WP Brand Content,” a platform that connects advertisers with the Post audience. All content is developed and paid for by the advertiser, but the Post newsroom is not involved with the creation of the content.

The Associated Press also announced plans to introduce sponsored content into its stream of news stories on mobile apps and its websites.

Publishers realize what’s going to drive readership is their unique content, whether it’s local news or exclusive content—it has to be something you can’t get anywhere else.

As newsrooms shrink and the numbers of pages get cut, is content still king?

Nonprofit journalism

According to a Pew Research Center study, all but nine U.S. states have at least one nonprofit news outlet specializing in journalism niches such as investigative reporting and the environment.

In 2010, ProPublica jointly won a Pulitzer Prize for Investigative Reporting, the first Pulitzer awarded to an online news source. It won a second Pulitzer in 2011. Last year, InsideClimate News Team won the Pulitzer Prize for National Reporting.

As newspapers like the Chicago Sun-Times lays off its entire photo staff and the Atlanta Journal-Constitution cuts its photo staff by half, many publishers may be looking for user-generated content to fill in the gaps.

Citizen journalism allows newspapers to get closer to their community, but is user-generated news a disruptive or complementary pairing?

Digital production

Executives are looking at digital presses to generate new revenue opportunities and produce quicker turnaround time while saving costs.

Companies like Océ and manroland have developed digital inkjet newspaper lines.

Newspapers are experimenting with digital printing as a distribution concept and as a way to produce additional print jobs.

Instead of competing with traditional offset printing, digital production can help create international editions and niche products.

BRANDS

BuzzFeed

After co-founding The Huffington Post in 2005, Jonah Peretti launched BuzzFeed in 2006.

According to the website, it reaches more than 80 million monthly unique visitors.

Known for promoting viral content, BuzzFeed is now expanding into foreign news and investigative journalism.

At a recent conference, BuzzFeed president Jon Steinberg was quoted as saying no new television viewers or print newspaper subscribers are being born.

Facebook

In 2004, Harvard University student Mark Zuckerberg founded thefacebook. It became known as Facebook.com a year later.

As reported by the Pew Research Center, nearly 64 percent of U.S. adults use Facebook and half of those users get their news there.

In 2012, Facebook purchased popular photo-sharing app Instagram for $1 billion in cash and stock.

Early last year, Facebook redesigned its news feed with larger photos and additional news feed sections in order to become “the best personalized newspaper” for its users.

Twitter

Twitter co-founder Jack Dorsey sent the first tweet in March 2006.

Reporters can now break news instantly in 140 characters and by tweeting photos live from the scene. Faced with the pressure of “being first,” news organizations exercise caution with unconfirmed reports.

Twitter launches promoted tweets in 2010 and a new wave of web advertising begins as newspapers start experimenting with sponsored tweets.

With more people using mobile and accessing their news on social media, Twitter is one of the key digital players.

The Guardian

The Guardian launches theguardian.com in 2013 as part of its transition from a British newspaper to a global digital media brand.

In June 2013, the Guardian’s Glenn Greenwald broke the news that the FBI and the National Security Agency were gathering the cell phone data of millions of Americans. The information was leaked from former CIA employee Edward Snowden.

The Snowden files bring to light freedom of press as newspapers such as the New York Times have denied requests to return Snowden data. Guardian editor-in-chief Alan Rusbridger has said he will continue to publish stories in the public interest.

According to a December 2012 comScore report, the Guardian is the third most read online newspaper in the world after Mail Online and the New York Times.

Deseret Digital Media

Based in Salt Lake City, Utah, the media company was created by CEO Clark Gilbert in 2010 after he decided to spin off the digital properties of the Deseret News and TV and radio station KSL.

The American Press Institute reported that while American newspapers average 17 percent of their revenue from digital, the Deseret News and Deseret Digital Media averages 45 percent.

According to an early 2013 Alliance for Audited Media report, the Deseret News was the second fastest growing news publication in the country with a 15 percent annual increase in circulation.

Gilbert introduced a “dual transformation” in his efforts to rebrand the newspaper, rebuilding the print newspaper and creating a new business unit.

The New York Times

As of March 2013, the AAM reports the Times has the second highest average daily circulation in the country behind the Wall Street Journal.

In December 2012, the Times introduced its Pulitzer-Prize winning story “Snow Fall,” a multimedia package with text, photos and videos about a deadly avalanche in Washington.

In October 2013, the Times launched the International New York Times (formerly the International Herald Tribune).

As one of the industry’s leaders in print and digital, many executives are anticipating the Times’ next move.

Newspaper Association of America

In 2011, the NAA debuted its “Smart is the new sexy” marketing campaign to mixed reactions in an effort to promote the industry in a savvy way.

2 thoughts on “An Industry in Motion”

Davis, Thank you for your comment. We double-checked that information and, in fact, the numbers are incorrect. That passage should have read: “The Pew Research Center reported print revenue brought in close to $19 billion in 2012. Total digital rose to $37.3 billion in 2012, a 17 percent increase.”

Great summary of the state of the publishing industry. It sure feels like we’re starting 2014 with an unprecedented cross-over between the publishing and non-publishing worlds. The situation begs the question, “Is running a publishing house going to be like running any other business or is there actually something to be said for the idea that publishers are out to retake control of their own industry?